Exhibit

Actual Plan Asset Returns

Expected Plan Asset Returns

(In percentages)

Q4 '18 & 2018

Q4 '17 & 2017

EX-99.2 3 q420188-kex992.htm EXHIBIT 99.2 Exhibit

Exhibit 99.2

Non-US GAAP Financial Measures and Supplemental Information

January 28, 2019

In this document, the terms the "Company," "we" and "our" refer to Celanese Corporation and its subsidiaries on a consolidated basis.

Purpose

The purpose of this document is to provide information of interest to investors, analysts and other parties including supplemental financial information and reconciliations and other information concerning our use of non-US GAAP financial measures. This document is updated quarterly.

Presentation

This document presents the Company's three business segments, Engineered Materials, Acetate Tow and Acetyl Chain.

Use of Non-US GAAP Financial Measures

From time to time, management may publicly disclose certain numerical "non-GAAP financial measures" in the course of our earnings releases, financial presentations, earnings conference calls, investor and analyst meetings and otherwise. For these purposes, the Securities and Exchange Commission ("SEC") defines a "non-GAAP financial measure" as a numerical measure of historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that effectively exclude amounts, included in the most directly comparable measure calculated and presented in accordance with US GAAP, and vice versa for measures that include amounts, or are subject to adjustments that effectively include amounts, that are excluded from the most directly comparable US GAAP measure so calculated and presented. For these purposes, "GAAP" refers to generally accepted accounting principles in the United States.

Non-GAAP financial measures disclosed by management are provided as additional information to investors, analysts and other parties because the Company believes them to be important supplemental measures for assessing our financial and operating results and as a means to evaluate our financial condition and period-to-period comparisons. These non-GAAP financial measures should be viewed as supplemental to, and should not be considered in isolation or as alternatives to, net earnings (loss), operating profit (loss), operating margin, cash flow from operating activities (together with cash flow from investing and financing activities), earnings per share or any other US GAAP financial measure. These non-GAAP financial measures should be considered within the context of our complete audited and unaudited financial results for the given period, which are available on the Financial Information/Documents page of our website, investors.celanese.com. The definition and method of calculation of the non-GAAP financial measures used herein may be different from other companies' methods for calculating measures with the same or similar titles. Investors, analysts and other parties should understand how another company calculates such non-GAAP financial measures before comparing the other company's non-GAAP financial measures to any of our own. These non-GAAP financial measures may not be indicative of the historical operating results of the Company nor are they intended to be predictive or projections of future results.

Pursuant to the requirements of SEC Regulation G, whenever we refer to a non-GAAP financial measure, we will also present in this document, in the presentation itself or on a Form 8-K in connection with the presentation on the Financial Information/Non-GAAP Financial Measures page of our website, investors.celanese.com, to the extent practicable, the most directly comparable financial measure calculated and presented in accordance with GAAP, along with a reconciliation of the differences between the non-GAAP financial measure we reference and such comparable GAAP financial measure.

This document includes definitions and reconciliations of non-GAAP financial measures used from time to time by the Company.

Specific Measures Used

This document provides information about the following non-GAAP measures: adjusted EBIT, adjusted EBIT margin, operating EBITDA, operating EBITDA margin, operating profit (loss) attributable to Celanese Corporation, adjusted earnings per share, net debt, free cash flow and return on invested capital (adjusted). The most directly comparable financial measure presented in accordance with US GAAP in our consolidated financial statements for adjusted EBIT and operating EBITDA is net earnings (loss) attributable to Celanese Corporation; for adjusted EBIT margin and operating EBITDA margin is operating margin; for operating profit (loss) attributable to Celanese Corporation is operating profit (loss); for adjusted earnings per share is earnings (loss) from continuing operations attributable to Celanese Corporation per common share-diluted; for net debt is total debt; for free cash flow is net cash provided by (used in) operations; and for return on invested capital (adjusted) is net earnings (loss) attributable to Celanese Corporation divided by the sum of the average of beginning and end of the year short- and long-term debt and Celanese Corporation stockholders' equity.

Definitions

•

Adjusted EBIT is a performance measure used by the Company and is defined by the Company as net earnings (loss) attributable to Celanese Corporation, plus (earnings) loss from discontinued operations, less interest income, plus interest expense, plus refinancing expense and taxes, and further adjusted for Certain Items (refer to Table 8). We believe that adjusted EBIT provides transparent and useful information to management, investors, analysts and other parties in evaluating and assessing our primary operating results from period-to-period after removing the impact of unusual, non-operational or restructuring-related activities that affect comparability. Our management recognizes that adjusted EBIT has inherent limitations because of the excluded items. Adjusted EBIT is one of the measures management uses for planning and budgeting, monitoring and evaluating financial and operating results and as a performance metric in the Company's incentive compensation plan. We do not provide reconciliations for adjusted EBIT on a forward-looking basis (including those contained in this document) when we are unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing and amount of Certain Items, such as mark-to-market pension gains and losses, that have not yet occurred, are out of our control and/or cannot be reasonably predicted. For the same reasons, we are unable to address the probable significance of the unavailable information. Adjusted EBIT margin is defined by the Company as adjusted EBIT divided by net sales. Adjusted EBIT margin has the same uses and limitations as Adjusted EBIT.


•	Adjusted EBIT by business segment may also be referred to by management as segment income. Adjusted EBIT margin by business segment may also be referred to by management as segment income margin.

•

Operating EBITDA is a performance measure used by the Company and is defined by the Company as net earnings (loss) attributable to Celanese Corporation, plus (earnings) loss from discontinued operations, less interest income, plus interest expense, plus refinancing expense, taxes and depreciation and amortization, and further adjusted for Certain Items, which Certain Items include accelerated depreciation and amortization expense. Operating EBITDA is equal to adjusted EBIT plus depreciation and amortization. We believe that Operating EBITDA provides transparent and useful information to investors, analysts and other parties in evaluating our operating performance relative to our peer companies. Operating EBITDA margin is defined by the Company as Operating EBITDA divided by net sales. Operating EBITDA margin has the same uses and limitations as Operating EBITDA.

•

Operating profit (loss) attributable to Celanese Corporation is defined by the Company as operating profit (loss), less earnings (loss) attributable to noncontrolling interests ("NCI"). We believe that operating profit (loss) attributable to Celanese Corporation provides transparent and useful information to management, investors, analysts and other parties in evaluating our core operational performance. Operating margin attributable to Celanese Corporation is defined by the Company as operating profit (loss) attributable to Celanese Corporation divided by net sales. Operating margin attributable to Celanese Corporation has the same uses and limitations as Operating profit (loss) attributable to Celanese Corporation.

•

Adjusted earnings per share is a performance measure used by the Company and is defined by the Company as earnings (loss) from continuing operations attributable to Celanese Corporation, adjusted for income tax (provision) benefit, Certain Items, and refinancing and related expenses, divided by the number of basic common shares and dilutive restricted stock units and stock options calculated using the treasury method. We believe that adjusted earnings per share provides transparent and useful information to management, investors, analysts and other parties in evaluating and assessing our primary operating results from period-to-period after removing the impact of the above stated items that affect comparability and as a performance metric in the Company's incentive compensation plan. We do not provide reconciliations for adjusted earnings per share on a forward-looking basis (including those contained in this document) when we are unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing and amount of Certain Items, such as mark-to-market pension gains and losses, that have not yet occurred, are out of our control and/or cannot be reasonably predicted. For the same reasons, we are unable to address the probable significance of the unavailable information.

Note: The income tax expense (benefit) on Certain Items ("Non-GAAP adjustments") is determined using the applicable rates in the taxing jurisdictions in which the Non-GAAP adjustments occurred and includes both current and deferred income tax expense (benefit). The income tax rate used for adjusted earnings per share approximates the midpoint in a range of forecasted tax rates for the year. This range may include certain partial or full-year forecasted tax opportunities and related costs, where applicable, and specifically excludes changes in uncertain tax positions, discrete recognition of GAAP items on a quarterly basis, other pre-tax items adjusted out of our GAAP earnings for adjusted earnings per share purposes and changes in management's assessments regarding the ability to realize deferred tax assets for GAAP. In determining the adjusted earnings per share tax rate, we reflect the impact of foreign tax credits when utilized, or expected to be utilized, absent discrete events impacting the timing of foreign tax credit utilization. We analyze this rate quarterly and adjust it if there is a material change in the range of forecasted tax rates; an updated forecast would not necessarily result in a change to our tax rate used for adjusted earnings per share. The adjusted tax rate is an estimate and may differ from the actual tax rate used for GAAP reporting in any given reporting period. Table 3a summarizes the reconciliation of our estimated GAAP effective tax rate to the adjusted tax rate. The estimated GAAP rate excludes discrete recognition of GAAP items due to our inability to forecast such items. As part of the year-end reconciliation, we will update the reconciliation of the GAAP effective tax rate to the adjusted tax rate for actual results.

•

Free cash flow is a liquidity measure used by the Company and is defined by the Company as net cash provided by (used in) operations, less capital expenditures on property, plant and equipment, and adjusted for capital contributions from or distributions to Mitsui & Co., Ltd. ("Mitsui") related to our methanol joint venture, Fairway Methanol LLC ("Fairway"). We believe that free cash flow provides useful information to management, investors, analysts and other parties in evaluating the Company's liquidity and credit quality assessment because it provides an indication of the long-term cash generating ability of our business. Although we use free cash flow as a measure to assess the liquidity generated by our business, the use of free cash flow has important limitations, including that free cash flow does not reflect the cash requirements necessary to service our indebtedness, lease obligations, unconditional purchase obligations or pension and postretirement funding obligations.


•	Net debt is defined by the Company as total debt less cash and cash equivalents. We believe that net debt provides useful information to management, investors, analysts and other parties in evaluating changes to the Company's capital structure and credit quality assessment.

•

Return on invested capital (adjusted) is defined by the Company as adjusted EBIT, tax effected using the adjusted tax rate, divided by the sum of the average of beginning and end of the year short- and long-term debt and Celanese Corporation stockholders' equity. We believe that return on invested capital (adjusted) provides useful information to management, investors, analysts and other parties in order to assess our income generation from the point of view of our stockholders and creditors who provide us with capital in the form of equity and debt and whether capital invested in the Company yields competitive returns. In addition, achievement of certain predetermined targets relating to return on invested capital (adjusted) is one of the factors we consider in determining the amount of performance-based compensation received by our management.

Supplemental Information

Supplemental Information we believe to be of interest to investors, analysts and other parties includes the following:


•	Net sales for each of our business segments and the percentage increase or decrease in net sales attributable to price, volume, currency and other factors for each of our business segments.


•	Cash dividends received from our equity investments.


•	For those consolidated ventures in which the Company owns or is exposed to less than 100% of the economics, the outside stockholders' interests are shown as NCI. Beginning in 2014, this includes Fairway for which the Company's ownership percentage is 50%. Amounts referred to as "attributable to Celanese Corporation" are net of any applicable NCI.

Recent Developments

Effective January 1, 2018, we reorganized our operating and reportable segments to align with recent structural and management reporting changes. The changes reflect the movement of our food ingredients business from the Consumer Specialties reportable segment into the Engineered Materials reportable segment. In addition, the former Consumer Specialties reportable segment was renamed the Acetate Tow segment, and the former Advanced Engineered Materials reportable segment was renamed the Engineered Materials segment. This reorganization better reflects how we manage our food ingredients' related products commercially. Engineered Materials and food ingredients are both project-based models that focus on delivering customized solutions and are led by the same senior management team.

Effective December 31, 2018, we further reorganized our operating and reportable segments to align with recent structural and management reporting changes. The change reflects the resegmentation of the former Industrial Specialties and former Acetyl Intermediates operating and reportable segments, to the Acetyl Chain operating and reportable segment. This reorganization reflects the culmination of a shift in operating strategy and organizational hierarchy, with a focus on integration, collaboration and maximization of value creation through our global optionality and integrated chain model of the underlying businesses along the Acetyl Chain segment. These changes in operating and reportable segments were applied retrospectively to prior periods through 2014.

Results Unaudited

The results in this document, together with the adjustments made to present the results on a comparable basis, have not been audited and are based on internal financial data furnished to management. Quarterly results should not be taken as an indication of the results of operations to be reported for any subsequent period or for the full fiscal year.

Table 1

Adjusted EBIT and Operating EBITDA - Reconciliation of Non-GAAP Measures - Unaudited



	2018		Q4 '18		Q3 '18		Q2 '18	Q1 '18		2017		Q4 '17	Q3 '17		Q2 '17		Q1 '17
	(In $ millions)
Net earnings (loss) attributable to Celanese Corporation	1,207		99		401		344	363		843		203	226		231		183
(Earnings) loss from discontinued operations	5		(3	)	6		—	2		13		1	4		8		—
Interest income	(6	)	(2	)	(2	)	—	(2	)	(2	)	—	(1	)	(1	)	—
Interest expense	125		30		30		32	33		122		31	32		30		29
Refinancing expense	1		1		—		—	—		—		—	—		—		—
Income tax provision (benefit)	292		76		54		97	65		213		60	57		40		56
Certain Items attributable to Celanese Corporation (Table 8)	228		192		5		18	13		167		57	27		18		65
Adjusted EBIT	1,852		393		494		491	474		1,356		352	345		326		333
Depreciation and amortization expense⁽¹⁾	316		78		77		82	79		303		79	78		75		71
Operating EBITDA	2,168		471		571		573	553		1,659		431	423		401		404



	2018	Q4 '18	Q3 '18	Q2 '18	Q1 '18	2017	Q4 '17	Q3 '17	Q2 '17	Q1 '17
	(In $ millions)
Engineered Materials	1	—	—	1	—	—	—	—	—	—
Acetate Tow	19	5	11	3	—	—	—	—	—	—
Acetyl Chain	7	5	2	—	—	2	—	2	—	—
Other Activities⁽²⁾	—	—	—	—	—	—	—	—	—	—
Accelerated depreciation and amortization expense	27	10	13	4	—	2	—	2	—	—
Depreciation and amortization expense⁽¹⁾	316	78	77	82	79	303	79	78	75	71
Total depreciation and amortization expense	343	88	90	86	79	305	79	80	75	71

______________________________


⁽¹⁾	Excludes accelerated depreciation and amortization expense as detailed in the table above, which amounts are included in Certain Items above.


⁽²⁾	Other Activities includes corporate Selling, general and administrative ("SG&A") expenses, the results of captive insurance companies and certain components of net periodic benefit cost (interest cost, expected return on plan assets and net actuarial gains and losses).



Table 2 - Supplemental Segment Data and Reconciliation of Segment Adjusted EBIT and Operating EBITDA - Non-GAAP Measures - Unaudited



	2018					Q4 '18				Q3 '18				Q2 '18				Q1 '18				2017				Q4 '17				Q3 '17				Q2 '17				Q1 '17
	(In $ millions, except percentages)
Operating Profit (Loss) / Operating Margin
Engineered Materials	460			17.7	%	95		15.3	%	124		19.3	%	114		17.2	%	127		19.1	%	412		18.6	%	98		16.9	%	105		18.3	%	105		19.2	%	104		20.2	%
Acetate Tow	130			20.0	%	19		11.8	%	26		16.5	%	39		24.1	%	46		27.4	%	189		28.3	%	41		26.1	%	45		28.7	%	41		25.2	%	62		32.5	%
Acetyl Chain⁽¹⁾	1,024			25.3	%	211		22.5	%	287		28.5	%	273		26.0	%	253		24.1	%	509		15.1	%	175		19.7	%	147		17.0	%	135		16.3	%	52		6.5	%
Other Activities⁽²⁾	(280	)				(66	)			(63	)			(68	)			(83	)			(253	)			(74	)			(68	)			(63	)			(48	)
Total	1,334			18.6	%	259		15.3	%	374		21.1	%	358		19.4	%	343		18.5	%	857		14.0	%	240		15.1	%	229		14.6	%	218		14.4	%	170		11.6	%
Less: Net Earnings (Loss) Attributable to NCI⁽¹⁾	6					2				1				1				2				6				1				2				2				1
Operating Profit (Loss) Attributable to Celanese Corporation	1,328			18.6	%	257		15.2	%	373		21.1	%	357		19.4	%	341		18.4	%	851		13.9	%	239		15.0	%	227		14.5	%	216		14.3	%	169		11.5	%
Operating Profit (Loss) / Operating Margin Attributable to Celanese Corporation
Engineered Materials	460			17.7	%	95		15.3	%	124		19.3	%	114		17.2	%	127		19.1	%	412		18.6	%	98		16.9	%	105		18.3	%	105		19.2	%	104		20.2	%
Acetate Tow	130			20.0	%	19		11.8	%	26		16.5	%	39		24.1	%	46		27.4	%	189		28.3	%	41		26.1	%	45		28.7	%	41		25.2	%	62		32.5	%
Acetyl Chain⁽¹⁾	1,018			25.2	%	209		22.3	%	286		28.4	%	272		25.9	%	251		23.9	%	503		14.9	%	174		19.6	%	145		16.8	%	133		16.1	%	51		6.4	%
Other Activities⁽²⁾	(280	)				(66	)			(63	)			(68	)			(83	)			(253	)			(74	)			(68	)			(63	)			(48	)
Total	1,328			18.6	%	257		15.2	%	373		21.1	%	357		19.4	%	341		18.4	%	851		13.9	%	239		15.0	%	227		14.5	%	216		14.3	%	169		11.5	%
Equity Earnings and Dividend Income, Other Income (Expense) Attributable to Celanese Corporation
Engineered Materials	219		⁽³⁾			49				62				54				54				171				43				47				38				43
Acetate Tow	116					25				26				33				32				107				26				24				28				29
Acetyl Chain	8					1				2				3				2				6				2				1				2				1
Other Activities⁽²⁾	15					8				1				—				6				10				8				(4	)			2				4
Total	358					83				91				90				94				294				79				68				70				77
Non-Operating Pension and Other Post-Retirement Employee Benefit (Expense) Income Attributable to Celanese Corporation
Engineered Materials	—					—				—				—				—				—				—				—				—				—
Acetate Tow	—					—				—				—				—				—				—				—				—				—
Acetyl Chain	—					—				—				—				—				2				1				1				—				—
Other Activities⁽²⁾	(62	)				(139	)			25				26				26				42				(24	)			22				22				22
Total	(62	)				(139	)			25				26				26				44				(23	)			23				22				22
Certain Items Attributable to Celanese Corporation(Table 8)
Engineered Materials	15					6				1				7				1				16				1				5				7				3
Acetate Tow	27					9				13				5				—				5				1				—				2				2
Acetyl Chain	(4	)				5				(11	)			2				—				64				1				10				(3	)			56
Other Activities⁽²⁾	190					172				2				4				12				82				54				12				12				4
Total	228					192				5				18				13				167				57				27				18				65
Adjusted EBIT / Adjusted EBIT Margin
Engineered Materials	694			26.8	%	150		24.1	%	187		29.1	%	175		26.4	%	182		27.4	%	599		27.1	%	142		24.5	%	157		27.4	%	150		27.5	%	150		29.2	%
Acetate Tow	273			42.1	%	53		32.9	%	65		41.1	%	77		47.5	%	78		46.4	%	301		45.1	%	68		43.3	%	69		43.9	%	71		43.6	%	93		48.7	%
Acetyl Chain	1,022			25.3	%	215		23.0	%	277		27.5	%	277		26.4	%	253		24.1	%	575		17.1	%	178		20.0	%	157		18.2	%	132		16.0	%	108		13.6	%
Other Activities⁽²⁾	(137	)				(25	)			(35	)			(38	)			(39	)			(119	)			(36	)			(38	)			(27	)			(18	)
Total	1,852			25.9	%	393		23.3	%	494		27.9	%	491		26.6	%	474		25.6	%	1,356		22.1	%	352		22.1	%	345		22.0	%	326		21.6	%	333		22.6	%

___________________________


⁽¹⁾	Net earnings (loss) attributable to NCI is included within the Acetyl Chain segment.


⁽²⁾	Other Activities includes corporate SG&A expenses, the results of captive insurance companies and certain components of net periodic benefit cost (interest cost, expected return on plan assets and net actuarial gains and losses).


⁽³⁾	Includes $218 million of Equity in net earnings (loss) of affiliates and $1 million of Other income.



Table 2 - Supplemental Segment Data and Reconciliation of Segment Adjusted EBIT and Operating EBITDA - Non-GAAP Measures - Unaudited (cont.)



	2018				Q4 '18				Q3 '18				Q2 '18				Q1 '18				2017				Q4 '17				Q3 '17				Q2 '17				Q1 '17
	(In $ millions, except percentages)
Depreciation and Amortization Expense⁽¹⁾
Engineered Materials	125				30				31				32				32				111				29				30				27				25
Acetate Tow	39				9				10				10				10				41				11				10				10				10
Acetyl Chain	141				36				34				36				35				141				37				34				36				34
Other Activities⁽²⁾	11				3				2				4				2				10				2				4				2				2
Total	316				78				77				82				79				303				79				78				75				71
Operating EBITDA / Operating EBITDA Margin
Engineered Materials	819		31.6	%	180		28.9	%	218		34.0	%	207		31.2	%	214		32.2	%	710		32.1	%	171		29.5	%	187		32.6	%	177		32.4	%	175		34.0	%
Acetate Tow	312		48.1	%	62		38.5	%	75		47.5	%	87		53.7	%	88		52.4	%	342		51.2	%	79		50.3	%	79		50.3	%	81		49.7	%	103		53.9	%
Acetyl Chain	1,163		28.8	%	251		26.8	%	311		30.9	%	313		29.8	%	288		27.4	%	716		21.2	%	215		24.2	%	191		22.1	%	168		20.3	%	142		17.9	%
Other Activities⁽²⁾	(126	)			(22	)			(33	)			(34	)			(37	)			(109	)			(34	)			(34	)			(25	)			(16	)
Total	2,168		30.3	%	471		27.9	%	571		32.2	%	573		31.1	%	553		29.9	%	1,659		27.0	%	431		27.1	%	423		27.0	%	401		26.6	%	404		27.5	%

___________________________


⁽¹⁾	Excludes accelerated depreciation and amortization expense, which amounts are included in Certain Items above. See Table 1 for details.


⁽²⁾	Other Activities includes corporate SG&A expenses, the results of captive insurance companies and certain components of net periodic benefit cost (interest cost, expected return on plan assets and net actuarial gains and losses).

Table 3

Adjusted Earnings (Loss) per Share - Reconciliation of a Non-GAAP Measure - Unaudited



	2018			Q4 '18			Q3 '18			Q2 '18			Q1 '18			2017			Q4 '17			Q3 '17			Q2 '17			Q1 '17
			per share			per share			per share			per share			per share			per share			per share			per share			per share			per share
	(In $ millions, except per share data)
Earnings (loss) from continuing operations attributable to Celanese Corporation	1,212		8.95	96		0.73	407		3.00	344		2.52	365		2.68	856		6.19	204		1.50	230		1.68	239		1.72	183		1.30
Income tax provision (benefit)	292			76			54			97			65			213			60			57			40			56
Earnings (loss) from continuing operations before tax	1,504			172			461			441			430			1,069			264			287			279			239
Certain Items attributable to Celanese Corporation(Table 8)	228			192			5			18			13			167			57			27			18			65
Refinancing and related expenses	1			1			—			—			—			—			—			—			—			—
Adjusted earnings (loss) from continuing operations before tax	1,733			365			466			459			443			1,236			321			314			297			304
Income tax (provision) benefit on adjusted earnings⁽¹⁾	(243	)		(51	)		(65	)		(64	)		(62	)		(198	)		(51	)		(50	)		(48	)		(49	)
Adjusted earnings (loss) from continuing operations⁽²⁾	1,490		11.00	314		2.38	401		2.96	395		2.90	381		2.79	1,038		7.51	270		1.98	264		1.93	249		1.79	255		1.81
	Diluted shares (in millions)⁽³⁾
Weighted average shares outstanding	134.3			131.2			134.5			135.6			135.9			137.9			135.8			136.6			138.6			140.6
Incremental shares attributable to equity awards	1.1			0.9			1.0			0.7			0.5			0.4			0.5			0.4			0.4			0.4
Total diluted shares	135.4			132.1			135.5			136.3			136.4			138.3			136.3			137.0			139.0			141.0

______________________________


⁽¹⁾	Calculated using adjusted effective tax rates (Table 3a) as follows:



	2018	Q4 '18	Q3 '18	Q2 '18	Q1 '18	2017	Q4 '17	Q3 '17	Q2 '17	Q1 '17
	(In percentages)
Adjusted effective tax rate	14	14	14	14	14	16	16	16	16	16


⁽²⁾	Excludes the immediate recognition of actuarial gains and losses and the impact of actual vs. expected plan asset returns.


⁽³⁾	Potentially dilutive shares are included in the adjusted earnings per share calculation when adjusted earnings are positive.

Table 3a

Adjusted Tax Rate - Reconciliation of a Non-GAAP Measure - Unaudited



	Actual
	2018		2017
	(In percentages)
US GAAP annual effective tax rate	19		20
Discrete quarterly recognition of GAAP items⁽¹⁾	—		(11	)
Tax impact of other charges and adjustments⁽²⁾	—		1
Utilization of foreign tax credits	—		20
Changes in valuation allowances, excluding impact of other charges and adjustments⁽³⁾	(5	)	(13	)
Other⁽⁴⁾	—		(1	)
Adjusted tax rate	14		16

______________________________

Note: As part of the year-end reconciliation, we updated the reconciliation of the GAAP effective tax rate for actual results.


⁽¹⁾	Such as changes in tax laws (including US tax reform), deferred taxes on outside basis differences, changes in uncertain tax positions and prior year audit adjustments.


⁽²⁾	Reflects the tax impact on pre-tax adjustments presented in Certain Items (Table 8), which are excluded from pre-tax income for adjusted earnings per share purposes.


⁽³⁾	Reflects changes in valuation allowances related to changes in judgment regarding the realizability of deferred tax assets or current year operations, excluding other charges and adjustments.


⁽⁴⁾	Tax impacts related to full-year forecasted tax opportunities and related costs.

Table 4

Net Sales by Segment - Unaudited



	2018		Q4 '18		Q3 '18		Q2 '18		Q1 '18		2017		Q4 '17		Q3 '17		Q2 '17		Q1 '17
	(In $ millions)
Engineered Materials	2,593		622		642		664		665		2,213		580		573		546		514
Acetate Tow	649		161		158		162		168		668		157		157		163		191
Acetyl Chain	4,042		936		1,006		1,049		1,051		3,371		888		863		826		794
Other Activities⁽¹⁾	—		—		—		—		—		—		—		—		—		—
Intersegment eliminations⁽²⁾	(129	)	(30	)	(35	)	(31	)	(33	)	(112	)	(32	)	(27	)	(25	)	(28	)
Net sales	7,155		1,689		1,771		1,844		1,851		6,140		1,593		1,566		1,510		1,471

___________________________


⁽¹⁾	Other Activities includes corporate SG&A expenses, the results of captive insurance companies and certain components of net periodic benefit cost (interest cost, expected return on plan assets and net actuarial gains and losses).


⁽²⁾	Includes intersegment sales primarily related to the Acetyl Chain.

Table 4a

Factors Affecting Segment Net Sales Sequentially - Unaudited

Three Months Ended December 31, 2018 Compared to Three Months Ended September 30, 2018



	Volume		Price		Currency		Other	Total
	(In percentages)
Engineered Materials	(4	)	2		(1	)	—	(3	)
Acetate Tow	2		(1	)	—		—	1
Acetyl Chain	(3	)	(4	)	(1	)	1	(7	)

Total Company	(3	)	(2	)	(1	)	1	(5	)

Three Months Ended September 30, 2018 Compared to Three Months Ended June 30, 2018



	Volume		Price	Currency		Other	Total
	(In percentages)
Engineered Materials	(2	)	—	(1	)	—	(3	)
Acetate Tow	(2	)	—	—		—	(2	)
Acetyl Chain	(4	)	2	(2	)	—	(4	)

Total Company	(3	)	1	(2	)	—	(4	)

Three Months Ended June 30, 2018 Compared to Three Months Ended March 31, 2018



	Volume		Price	Currency		Other		Total
	(In percentages)
Engineered Materials	(1	)	3	(2	)	—		—
Acetate Tow	(3	)	—	(1	)	—		(4	)
Acetyl Chain	(2	)	4	(1	)	(1	)	—

Total Company	(2	)	3	(1	)	—		—

Three Months Ended March 31, 2018 Compared to Three Months Ended December 31, 2017



	Volume	Price	Currency	Other		Total
	(In percentages)
Engineered Materials	10	3	2	—		15	⁽¹⁾
Acetate Tow	8	—	—	—		8
Acetyl Chain	8	9	3	(2	)	18

Total Company	9	6	2	(1	)	16

Three Months Ended December 31, 2017 Compared to Three Months Ended September 30, 2017



	Volume		Price		Currency	Other	Total
	(In percentages)
Engineered Materials	(8	)	9		—	—	1
Acetate Tow	2		(2	)	—	—	—
Acetyl Chain	(5	)	7		—	1	3

Total Company	(5	)	7		—	—	2

Three Months Ended September 30, 2017 Compared to Three Months Ended June 30, 2017



	Volume		Price	Currency	Other	Total
	(In percentages)
Engineered Materials	1		1	3	—	5
Acetate Tow	(5	)	1	—	—	(4	)
Acetyl Chain	1		—	3	—	4

Total Company	—		1	3	—	4

Three Months Ended June 30, 2017 Compared to Three Months Ended March 31, 2017



	Volume		Price		Currency	Other		Total
	(In percentages)
Engineered Materials	4		—		2	—		6		⁽²⁾
Acetate Tow	(12	)	(3	)	—	—		(15	)
Acetyl Chain	—		5		1	(2	)	4

Total Company	—		3		1	(1	)	3

Three Months Ended March 31, 2017 Compared to Three Months Ended December 31, 2016



	Volume	Price		Currency		Other	Total
	(In percentages)
Engineered Materials	33	—		(1	)	—	32		⁽³⁾
Acetate Tow	2	(6	)	—		—	(4	)
Acetyl Chain	2	5		(1	)	—	6

Total Company	11	2		(1	)	—	12

___________________________


⁽¹⁾	2018 includes the effect of the acquisition of Omni Plastics, L.L.C.


⁽²⁾	2017 includes the effect of the acquisition of the nylon compounding division of Nilit Group.


⁽³⁾	2017 includes the effect of the SO.F.TER. S.p.A. acquisition.

Table 4b

Factors Affecting Segment Net Sales Year Over Year - Unaudited

Three Months Ended December 31, 2018 Compared to Three Months Ended December 31, 2017



	Volume		Price		Currency		Other		Total
	(In percentages)
Engineered Materials	2		7		(2	)	—		7
Acetate Tow	5		(2	)	—		—		3
Acetyl Chain	(2	)	10		(2	)	(1	)	5

Total Company	—		8		(2	)	—		6

Three Months Ended September 30, 2018 Compared to Three Months Ended September 30, 2017



	Volume		Price		Currency		Other		Total
	(In percentages)
Engineered Materials	7		6		(1	)	—		12
Acetate Tow	5		(3	)	—		(1	)	1
Acetyl Chain	(3	)	22		—		(2	)	17

Total Company	1		14		(1	)	(1	)	13

Three Months Ended June 30, 2018 Compared to Three Months Ended June 30, 2017



	Volume	Price		Currency	Other		Total
	(In percentages)
Engineered Materials	11	7		4	—		22
Acetate Tow	1	(2	)	—	—		(1	)
Acetyl Chain	6	19		5	(3	)	27

Total Company	7	13		4	(2	)	22

Three Months Ended March 31, 2018 Compared to Three Months Ended March 31, 2017



	Volume		Price		Currency	Other		Total
	(In percentages)
Engineered Materials	19		3		7	—		29
Acetate Tow	(9	)	(4	)	1	—		(12	)
Acetyl Chain	3		25		7	(3	)	32

Total Company	7		14		6	(1	)	26

Three Months Ended December 31, 2017 Compared to Three Months Ended December 31, 2016



	Volume		Price		Currency	Other		Total
	(In percentages)
Engineered Materials	45		—		4	—		49
Acetate Tow	(14	)	(9	)	1	1		(21	)
Acetyl Chain	(2	)	19		4	(2	)	19

Total Company	10		10		3	(1	)	22

Three Months Ended September 30, 2017 Compared to Three Months Ended September 30, 2016



	Volume		Price		Currency	Other		Total
	(In percentages)
Engineered Materials	45		(2	)	2	—		45
Acetate Tow	(12	)	(8	)	1	—		(19	)
Acetyl Chain	—		13		2	(2	)	13

Total Company	11		6		2	(1	)	18

Three Months Ended June 30, 2017 Compared to Three Months Ended June 30, 2016



	Volume		Price		Currency		Other		Total
	(In percentages)
Engineered Materials	42		(2	)	(1	)	—		39
Acetate Tow	(13	)	(9	)	—		—		(22	)
Acetyl Chain	(3	)	12		(2	)	(1	)	6

Total Company	8		5		(1	)	—		12

Three Months Ended March 31, 2017 Compared to Three Months Ended March 31, 2016



	Volume		Price		Currency		Other	Total
	(In percentages)
Engineered Materials	43		(4	)	(2	)	—	37
Acetate Tow	(6	)	(7	)	—		—	(13	)
Acetyl Chain	(9	)	5		(2	)	1	(5	)

Total Company	5		1		(2	)	1	5

Table 4c

Factors Affecting Segment Net Sales Year Over Year - Unaudited

Year Ended December 31, 2018 Compared to Year Ended December 31, 2017



	Volume	Price		Currency	Other		Total
	(In percentages)
Engineered Materials	9	6		2	—		17
Acetate Tow	—	(3	)	—	—		(3	)
Acetyl Chain	1	19		2	(2	)	20

Total Company	4	12		2	(1	)	17

Year Ended December 31, 2017 Compared to Year Ended December 31, 2016



	Volume		Price		Currency	Other	Total
	(In percentages)
Engineered Materials	44		(2	)	1	—	43
Acetate Tow	(11	)	(8	)	—	—	(19	)
Acetyl Chain	(4	)	12		—	—	8

Total Company	9		5		—	—	14

Table 5

Free Cash Flow - Reconciliation of a Non-GAAP Measure - Unaudited



	2018		Q4 '18		Q3 '18		Q2 '18		Q1 '18		2017		Q4 '17		Q3 '17		Q2 '17		Q1 '17
	(In $ millions)
Net cash provided by (used in) investing activities	(507	)	(98	)	(78	)	(96	)	(235	)	(549	)	(92	)	(68	)	(325	)	(64	)
Net cash provided by (used in) financing activities	(1,165	)	(526	)	(383	)	(254	)	(2	)	(351	)	145		(247	)	21		(270	)

Net cash provided by (used in) operating activities	1,558		363		467		585		143		803		58		255		298		192
Capital expenditures on property, plant and equipment	(337	)	(93	)	(79	)	(79	)	(86	)	(267	)	(87	)	(64	)	(54	)	(62	)
Capital (distributions to) contributions from NCI	(23	)	(9	)	(6	)	(6	)	(2	)	(27	)	(9	)	(10	)	(4	)	(4	)
Free cash flow⁽¹⁾⁽²⁾	1,198		261		382		500		55		509		(38	)	181		240		126

Net sales	7,155		1,689		1,771		1,844		1,851		6,140		1,593		1,566		1,510		1,471

Free cash flow as % of Net sales	16.7	%	15.5	%	21.6	%	27.1	%	3.0	%	8.3	%	(2.4	)%	11.6	%	15.9	%	8.6	%

______________________________


⁽¹⁾	Free cash flow is a liquidity measure used by the Company and is defined by the Company as net cash provided by (used in) operating activities, less capital expenditures on property, plant and equipment, and adjusted for capital contributions from or distributions to Mitsui & Co., Ltd. ("Mitsui") related to our joint venture, Fairway Methanol LLC ("Fairway").


⁽²⁾	Excludes required debt service and capital lease payments of $63 million and $27 million for the years ending December 31, 2018 and 2017, respectively.

Table 6

Cash Dividends Received - Unaudited



	2018	Q4 '18	Q3 '18	Q2 '18	Q1 '18	2017	Q4 '17	Q3 '17	Q2 '17	Q1 '17
	(In $ millions)
Dividends from equity method investments	221	62	44	39	76	131	17	5	59	50
Dividends from equity investments without readily determinable fair values	117	25	26	34	32	108	26	24	29	29
Total	338	87	70	73	108	239	43	29	88	79

Table 7

Net Debt - Reconciliation of a Non-GAAP Measure - Unaudited



	2018		Q4 '18		Q3 '18		Q2 '18		Q1 '18		2017		Q4 '17		Q3 '17		Q2 '17		Q1 '17
	(In $ millions)
Short-term borrowings and current installments of long-term debt - third party and affiliates	561		561		229		366		425		326		326		435		384		107
Long-term debt, net of unamortized deferred financing costs	2,970		2,970		3,196		3,228		3,343		3,315		3,315		2,954		2,931		2,851
Total debt	3,531		3,531		3,425		3,594		3,768		3,641		3,641		3,389		3,315		2,958
Cash and cash equivalents	(439	)	(439	)	(703	)	(708	)	(490	)	(576	)	(576	)	(461	)	(511	)	(501	)
Net debt	3,092		3,092		2,722		2,886		3,278		3,065		3,065		2,928		2,804		2,457

Table 8

Certain Items - Unaudited

The following Certain Items attributable to Celanese Corporation are included in Net earnings (loss) and are adjustments to non-GAAP measures:



	2018	Q4 '18	Q3 '18	Q2 '18	Q1 '18	2017	Q4 '17	Q3 '17	Q2 '17		Q1 '17		Income Statement Classification
	(In $ millions)
Plant/office closures	19	16	—	3	—	58	2	2	(3	)	57		Cost of sales / SG&A / R&D / Other charges (gains), net
Mergers and acquisitions	33	6	3	11	13	35	9	10	7		9		Cost of sales / SG&A / Other income (expense), net
Impact from natural disasters⁽¹⁾	—	—	—	—	—	11	—	11	—		—		Cost of sales
InfraServ ownership change	—	—	—	—	—	8	—	—	8		—		Other charges (gains), net / Equity in net earnings (loss) of affiliates
Actuarial (gain) loss on pension and postretirement plans	166	166	—	—	—	46	46	—	—		—		Cost of sales / SG&A / Non-operating pension and other postretirement employee benefit (expense) income
Restructuring	9	4	2	3	—	9	—	4	3		2		Cost of sales / SG&A / Other charges (gains), net / Non-operating pension and other postretirement employee benefit (expense) income
Other	1	—	—	1	—	—	—	—	3		(3	)	(Gain) loss on disposition, net / Equity in net earnings (loss) of affiliates
Certain Items attributable to Celanese Corporation	228	192	5	18	13	167	57	27	18		65

______________________________


⁽¹⁾	Primarily associated with Hurricane Harvey.

Table 9

Return on Invested Capital (Adjusted) - Presentation of a Non-GAAP Measure - Unaudited



			2018				2017
			(In $ millions, except percentages)				(In $ millions, except percentages)
Net earnings (loss) attributable to Celanese Corporation			1,207				843

Adjusted EBIT(Table 1)			1,852				1,356
Adjusted effective tax rate (Table 3a)			14	%			16	%
Adjusted EBIT tax effected			1,593				1,139

	2018	2017	Average		2017	2016	Average
	(In $ millions, except percentages)
Short-term borrowings and current installments of long-term debt - third parties and affiliates	561	326	444		326	118	222
Long-term debt, net of unamortized deferred financing costs	2,970	3,315	3,143		3,315	2,890	3,103
Celanese Corporation stockholders' equity	2,984	2,887	2,936		2,887	2,588	2,738
Invested capital			6,523				6,063

Return on invested capital (adjusted)			24.4	%			18.8	%

Net earnings (loss) attributable to Celanese Corporation as a percentage of invested capital			18.5	%			13.9	%